Discussion - Member to Member Sales - Research Center
Discussion - Member to Member Sales - Research Center
Point #1: Sales Increments
Seller lists a stamp at a $0.01 opening bid.
Buyer#1 submits a bid of $0.01 which is accepted.
Buyer#2 must submit a minimum bid of $0.06 (an increment of 5c).
Point #2: Sales Proxies - Simple Case
Seller lists a stamp at a $0.01 opening bid.
Buyer#1 submits a bid of $0.06 which is accepted at $0.01 (the lowest acceptable bid - not the higher amount submitted) but has an outstanding proxy bid of $0.06 awaiting further bids.
Buyer#2 doesn't see that the proxy bid is there (or the amount) and must submit a minimum bid of $0.06 (as above). They do so but Buyer#1 is still the winning bidder at $0.06 because of the existence of the assumed proxy bid rule ("tie goes to the first in").
Point #3: Sales Proxies - Confirmation of a Variation on the Simple Case
Seller lists a stamp at a $0.01 opening bid.
Buyer#1 submits a slightly higher bid - compared to Point #2 - of $0.07 which is again accepted at $0.01 (the lowest acceptable bid - not the higher amount submitted) but now has an outstanding proxy bid of $0.07 awaiting further bids. They do so because they suspect Buyer#2 will anticipate their proxy bid of $0.06 and try to slip by the "tie bid" rule with the extra 1c.
Buyer #2 is crafty, and does submit a bid of $0.07. Outcome: Buyer#1 wins (tie) at $0.07.
Now here's the question: If Buyer#2 submitted an offer at $0.06 would Bidder#1 still become the high bidder at $0.06 because of the "tie" with the second bid or are they "punished" for anticipating an outbid, and required to pay a premium of 1c (i.e. $0.07)? If so, does that seem fair?
Point #4: A Further Question and Possible Example of the Unfairness/Inefficiency
Buyer#1 submits an initial bid for $0.11 with the rationale that if Bidder#2 submits at $0.06 Bidder#1 will win with a tie at $0.06 (as it should be). And so it would take Bidder#3 to come in at the next level ($0.11) which Bidder #1 would also win with a tie (as it should be).
But I seem to have had a few situations where Bidder#1 (me) enters a bid of $0.11 - winning initially at $0.01. But when Bidder#2 enters at $0.06 I don't win with a tie and reset the next bid level at $0.11. I immediately get bumped up to a current winning bid of $0.11. OVERPAYING when I shouldn't have to in the absence of an actual competitive/tie bid.
So, I could be wrong (and hope I am). Because if I'm correct then the programming of the rules is at best inefficient and at worst unfair.
Thoughts/feedback?
Thanks, Dave.
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Dave:
My assumption has always been that the 'tie' rule only works in cases of true ties (Buyer 1 and Buyer 2 both submit equal maximum bids). I generally bid according to your Case 3/4 scenarios (usually case 3). I do not know if this works or not - I simply set the maximum amount I am willing to bid for whatever item I am bidding on.
Are we talking online auctions in general or Stamporama specifically?
Darryl
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To answer the questions of both questions in Points 3 & 4 - Proxie bids raise the active bid by one bid increment or the highest bid if that is less than the next bid increment.
So, in Point 3, if the buyer 2 bids 0.06, they proxy bid would have raised the high bid to 0.11, but because the high bid is only 0.07, that becomes the high bid.
In Point 4, the smallest bid increment is 0.05, so if the buyer 1 bid was 0.2 and the current bid is 0.06 and buyer 2 bids 0.06, the proxy bid on your behalf would increase the current bid level by five cents to 0.11.
Almost all auctions have a bid increment system, and StampoRama auctions are no different. This is disclosed in our Auction tutorial: Tutorial - Bid Increments
Here is a series of bids and proxy bids (called Proxie in our auction system)
Example:
$0.25 Bid
$0.30 Bid
$0.35 Bid
$0.40 Proxie $0.05 auction increment
$1.30 Bid
$1.40 Proxie $0.10 auction increment
$2.00 Bid
$2.10 Proxie $0.10 auction increment
$3.00 Proxie high bid proxy bid (not an increment)
$3.10 Bid New High Bid with $0.10 auction increment
$4.00 Bid
$4.25 Proxie $0.25 auction increment
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As per Darryl's point, I am only referring to SOR Auctions. And to Antonio's point, I haven't examined it, but accept that a rule is in place - and is disclosed somewhere in the rule book.
No disrespect to Antonio, as he is just pointing to the facts and providing a great example (although my MBA is useless in trying to decipher it as my ADD predisposition is that any justification based on "it's a rule, and it's in the rule book" is not a priori, and doesn't make sense to me if it's a "bad" rule).
So, to get back to my fundamental point - which I think is quite simple, logical and fair. My example is as follows (apologies in advance but I am a slow and sequential learner):
...Bidder#1 bids 1c.
...Bidder#x must bid 6c (the new reset level) but can bid more.
Yes or no?
...Bidder#2 bids 6c.
...If Bidder#1 has already bid (by proxy) 6c then it is a tie, and Bidder#1 prevails at 6c.
Yes or no?
If yes, then Bidder#x must bid 11c (the new reset level) but can bid more.
Yes or no?
I'm going to stop there and wait for feedback on these questions relative to this specific example. Although I may have a followup (actually, it's probably obvious I will have a followup) I am hoping just for an answer to the questions in this example without reaching beyond to try and justify what I haven't yet asked.
Thanks, Dave.
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Yes
Yes
Yes
Tad
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02:01:24pm
Dave, I think what you are missing is that a proxy bidding system is exactly like having the auctioneer of any major stamp auction execute your "bids in the book".
Let's say:
1) your bid is the current high bid, but the auctioneer has a higher bid in his book for you. (that's the maximum "proxy bid")
2) Another bidder bids, could be one increment or more above your bid
3) The auctioneer (or the proxy engine) says "I have a higher bid" and places a bid for you at the lower of a) your maximum bid, or b) the next available increment above the current bid. (In a real auction, "a" is typically not available, the auctioneer will demand that your bids adhere to the increment schedule, but computers are more lenient).
Your earlier example of the "inefficiency" is the equivalent of saying to the second bidder "you can't have that bid, the auctioneer has a higher bid in the book, so I want that bid, I am tying you and I take precedence". But it doesn't work that way, either in the computer or the real world. Bidders take turns bidding, and one cannot claim a particular bid by saying "I was here first with a higher bid, so I want this level too." This is true right up until your maximum bid, where you DO get precedence again - the auctioneer will not allow your maximum bid to be bid by someone on the floor. Unfortunately, by having to claim a particular bid, (and I hate this when it is my bid in the book!) he actually reveals that this is your maximum bid and that "one more bid will take it". That happens, for example if you have $300 "in the book" and the natural bidding sequence takes the lot to $290, on your bid. He will typically say to the floor bidder, "I have $300, you have to go $310". If the floor bidder says yes, you lose the lot. If he says no, you get it at the $290 bid.
Of course, if the natural bidding sequence gives you the $300 bid, he should say nothing, awarding you the lot if bidding stops there, and ceasing bidding for you if a $310 bid comes from the floor. However, too often, (and this I REALLY hate), auctioneers will say to the floor bidder "one more will take it" -- because they don't have to ship the lot to a floor bidder.
So the bottom line on proxy bidding is that you will always be bidding one increment above the previous bid, until your maximum is reached.
Roy
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Thanks Roy.
I'm not sure I am "missing" anything (especially around complex rules/arguments my limited intellect can't follow - including your explanation, which is probably great but well beyond me) so much as "grappling to understand".
As a follower of the Occam's Razor concept (which I refer to mostly to sound smart and not reveal my natural idiocy) - and as I often say (more directly) to my wife and two teenage daughters, "I'm just a boy who likes to know things". And I have a hard time associating "what happens here" with "what it's like somewhere else". (Unfortunately, ODD is probably another of my multiple "issues").
So, I have an idea of what I think is logical and fair. But that may not - probably is not - definitely(?) is not - the situation here.
Quite honestly, I appreciate the expansive explanations thus far, and I'm not trying to be a PITA. I'm just looking for clarification so I clearly understand the rules and can act accordingly.
If that leads to a re-thinking of the system (improbable) that's groovy, but not necessary. If it returns the answer "status quo will remain as such" (and if I can puzzle out what the algorithm is - both as a buyer and seller) then that is equally groovy.
So...if the final verdict is, "it is what it is"...I'm good to go for soundcrest's penny-pincher offerings tomorrow afternoon.
Thanks, Dave.
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Somehow I just knew it was about those penny auctions of mine.......
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04:10:43pm
" I'm just looking for clarification so I clearly understand the rules and can act accordingly."
The rule is that your "bot" (the proxy bidding engine) takes turns bidding against other bidders until your maximum is reached. Each "turn" requires one bid increment. You don't get to usurp the other bidder's turn to bid by claiming a tie at intermediate levels.
The auctions weren't designed to provide competitive bidding at levels below 10c. Normally, auction increments are on the order of 5%-10% advances of the current bid. If the auction were really designed to operate at these levels, bid increments would be 1c up to 10c, 2c to 20c and 5c thereafter to merge with the existing increments. Heaven forbid! There are already too many under 10c lots in the auction.
Roy
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"Somehow I just knew it was about those penny auctions of mine......."
More about the wise guys who bid a penny!
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"So, I have an idea of what I think is logical and fair. But that may not - probably is not - definitely(?) is not - the situation here. "
Dave, breathe deep and calm down! Everything will be okay! It's a computer. Computers are good. They cannot be wrong. Just relax and enjoy the blinking emoji!
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As they say in the auction world "Don't lose it for one more bid"
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Obviously the simple solution is to bid $2 on every penny auction. Who would beat you? (well one guy would but he left this site almost as soon as he joined it)
Greg
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In honour of my boy brechinite, I am going to bid a farthing on soundcrest's auction today.
And all is good. I now know the algorithm and where I have gone wrong before.
Unfortunately, after further analysis I determined this will reduce the sales of a certain "dealer" by up to 3c per month. Fortunately, the "dealer-haters" can offer even more "thanks-giving" for that. Good timing!
Woo hoo! Making everybody happy!
Dave.
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Lemaven:- confuse everybody by bidding either a groat or better still a bawbee.
Please Note I said groat not GOAT!!
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Somewhere I have a 1/3 farthing.
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"In honour of my boy brechinite, I am going to bid a farthing on soundcrest's auction today."
A quarter of a cent, eh? Dave - two questions - does the system accept decimals, and if you win, are you going to cut Mr. Lincoln in four? (I'd say good Queen Bess, but US currency is the standard here)
You could be onto something truly revolutionary, Dave!
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Of course instead of bidding you could ask to trade, because I bet that isn't the only copy he has.
The old barter system can still work at times
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Let me take a very specific example to then work towards the theory and practice...
Point #1: Sales Increments
Seller lists a stamp at a $0.01 opening bid.
Buyer#1 submits a bid of $0.01 which is accepted.
Buyer#2 must submit a minimum bid of $0.06 (an increment of 5c).
Point #2: Sales Proxies - Simple Case
Seller lists a stamp at a $0.01 opening bid.
Buyer#1 submits a bid of $0.06 which is accepted at $0.01 (the lowest acceptable bid - not the higher amount submitted) but has an outstanding proxy bid of $0.06 awaiting further bids.
Buyer#2 doesn't see that the proxy bid is there (or the amount) and must submit a minimum bid of $0.06 (as above). They do so but Buyer#1 is still the winning bidder at $0.06 because of the existence of the assumed proxy bid rule ("tie goes to the first in").
Point #3: Sales Proxies - Confirmation of a Variation on the Simple Case
Seller lists a stamp at a $0.01 opening bid.
Buyer#1 submits a slightly higher bid - compared to Point #2 - of $0.07 which is again accepted at $0.01 (the lowest acceptable bid - not the higher amount submitted) but now has an outstanding proxy bid of $0.07 awaiting further bids. They do so because they suspect Buyer#2 will anticipate their proxy bid of $0.06 and try to slip by the "tie bid" rule with the extra 1c.
Buyer #2 is crafty, and does submit a bid of $0.07. Outcome: Buyer#1 wins (tie) at $0.07.
Now here's the question: If Buyer#2 submitted an offer at $0.06 would Bidder#1 still become the high bidder at $0.06 because of the "tie" with the second bid or are they "punished" for anticipating an outbid, and required to pay a premium of 1c (i.e. $0.07)? If so, does that seem fair?
Point #4: A Further Question and Possible Example of the Unfairness/Inefficiency
Buyer#1 submits an initial bid for $0.11 with the rationale that if Bidder#2 submits at $0.06 Bidder#1 will win with a tie at $0.06 (as it should be). And so it would take Bidder#3 to come in at the next level ($0.11) which Bidder #1 would also win with a tie (as it should be).
But I seem to have had a few situations where Bidder#1 (me) enters a bid of $0.11 - winning initially at $0.01. But when Bidder#2 enters at $0.06 I don't win with a tie and reset the next bid level at $0.11. I immediately get bumped up to a current winning bid of $0.11. OVERPAYING when I shouldn't have to in the absence of an actual competitive/tie bid.
So, I could be wrong (and hope I am). Because if I'm correct then the programming of the rules is at best inefficient and at worst unfair.
Thoughts/feedback?
Thanks, Dave.
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Dave:
My assumption has always been that the 'tie' rule only works in cases of true ties (Buyer 1 and Buyer 2 both submit equal maximum bids). I generally bid according to your Case 3/4 scenarios (usually case 3). I do not know if this works or not - I simply set the maximum amount I am willing to bid for whatever item I am bidding on.
Are we talking online auctions in general or Stamporama specifically?
Darryl
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
To answer the questions of both questions in Points 3 & 4 - Proxie bids raise the active bid by one bid increment or the highest bid if that is less than the next bid increment.
So, in Point 3, if the buyer 2 bids 0.06, they proxy bid would have raised the high bid to 0.11, but because the high bid is only 0.07, that becomes the high bid.
In Point 4, the smallest bid increment is 0.05, so if the buyer 1 bid was 0.2 and the current bid is 0.06 and buyer 2 bids 0.06, the proxy bid on your behalf would increase the current bid level by five cents to 0.11.
Almost all auctions have a bid increment system, and StampoRama auctions are no different. This is disclosed in our Auction tutorial: Tutorial - Bid Increments
Here is a series of bids and proxy bids (called Proxie in our auction system)
Example:
$0.25 Bid
$0.30 Bid
$0.35 Bid
$0.40 Proxie $0.05 auction increment
$1.30 Bid
$1.40 Proxie $0.10 auction increment
$2.00 Bid
$2.10 Proxie $0.10 auction increment
$3.00 Proxie high bid proxy bid (not an increment)
$3.10 Bid New High Bid with $0.10 auction increment
$4.00 Bid
$4.25 Proxie $0.25 auction increment
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
As per Darryl's point, I am only referring to SOR Auctions. And to Antonio's point, I haven't examined it, but accept that a rule is in place - and is disclosed somewhere in the rule book.
No disrespect to Antonio, as he is just pointing to the facts and providing a great example (although my MBA is useless in trying to decipher it as my ADD predisposition is that any justification based on "it's a rule, and it's in the rule book" is not a priori, and doesn't make sense to me if it's a "bad" rule).
So, to get back to my fundamental point - which I think is quite simple, logical and fair. My example is as follows (apologies in advance but I am a slow and sequential learner):
...Bidder#1 bids 1c.
...Bidder#x must bid 6c (the new reset level) but can bid more.
Yes or no?
...Bidder#2 bids 6c.
...If Bidder#1 has already bid (by proxy) 6c then it is a tie, and Bidder#1 prevails at 6c.
Yes or no?
If yes, then Bidder#x must bid 11c (the new reset level) but can bid more.
Yes or no?
I'm going to stop there and wait for feedback on these questions relative to this specific example. Although I may have a followup (actually, it's probably obvious I will have a followup) I am hoping just for an answer to the questions in this example without reaching beyond to try and justify what I haven't yet asked.
Thanks, Dave.
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Yes
Yes
Yes
Tad
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21 Nov 2017
02:01:24pm
re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Dave, I think what you are missing is that a proxy bidding system is exactly like having the auctioneer of any major stamp auction execute your "bids in the book".
Let's say:
1) your bid is the current high bid, but the auctioneer has a higher bid in his book for you. (that's the maximum "proxy bid")
2) Another bidder bids, could be one increment or more above your bid
3) The auctioneer (or the proxy engine) says "I have a higher bid" and places a bid for you at the lower of a) your maximum bid, or b) the next available increment above the current bid. (In a real auction, "a" is typically not available, the auctioneer will demand that your bids adhere to the increment schedule, but computers are more lenient).
Your earlier example of the "inefficiency" is the equivalent of saying to the second bidder "you can't have that bid, the auctioneer has a higher bid in the book, so I want that bid, I am tying you and I take precedence". But it doesn't work that way, either in the computer or the real world. Bidders take turns bidding, and one cannot claim a particular bid by saying "I was here first with a higher bid, so I want this level too." This is true right up until your maximum bid, where you DO get precedence again - the auctioneer will not allow your maximum bid to be bid by someone on the floor. Unfortunately, by having to claim a particular bid, (and I hate this when it is my bid in the book!) he actually reveals that this is your maximum bid and that "one more bid will take it". That happens, for example if you have $300 "in the book" and the natural bidding sequence takes the lot to $290, on your bid. He will typically say to the floor bidder, "I have $300, you have to go $310". If the floor bidder says yes, you lose the lot. If he says no, you get it at the $290 bid.
Of course, if the natural bidding sequence gives you the $300 bid, he should say nothing, awarding you the lot if bidding stops there, and ceasing bidding for you if a $310 bid comes from the floor. However, too often, (and this I REALLY hate), auctioneers will say to the floor bidder "one more will take it" -- because they don't have to ship the lot to a floor bidder.
So the bottom line on proxy bidding is that you will always be bidding one increment above the previous bid, until your maximum is reached.
Roy
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Thanks Roy.
I'm not sure I am "missing" anything (especially around complex rules/arguments my limited intellect can't follow - including your explanation, which is probably great but well beyond me) so much as "grappling to understand".
As a follower of the Occam's Razor concept (which I refer to mostly to sound smart and not reveal my natural idiocy) - and as I often say (more directly) to my wife and two teenage daughters, "I'm just a boy who likes to know things". And I have a hard time associating "what happens here" with "what it's like somewhere else". (Unfortunately, ODD is probably another of my multiple "issues").
So, I have an idea of what I think is logical and fair. But that may not - probably is not - definitely(?) is not - the situation here.
Quite honestly, I appreciate the expansive explanations thus far, and I'm not trying to be a PITA. I'm just looking for clarification so I clearly understand the rules and can act accordingly.
If that leads to a re-thinking of the system (improbable) that's groovy, but not necessary. If it returns the answer "status quo will remain as such" (and if I can puzzle out what the algorithm is - both as a buyer and seller) then that is equally groovy.
So...if the final verdict is, "it is what it is"...I'm good to go for soundcrest's penny-pincher offerings tomorrow afternoon.
Thanks, Dave.
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Somehow I just knew it was about those penny auctions of mine.......
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21 Nov 2017
04:10:43pm
re: Clarifying Proxie Bids - Is There an "Inefficiency"?
" I'm just looking for clarification so I clearly understand the rules and can act accordingly."
The rule is that your "bot" (the proxy bidding engine) takes turns bidding against other bidders until your maximum is reached. Each "turn" requires one bid increment. You don't get to usurp the other bidder's turn to bid by claiming a tie at intermediate levels.
The auctions weren't designed to provide competitive bidding at levels below 10c. Normally, auction increments are on the order of 5%-10% advances of the current bid. If the auction were really designed to operate at these levels, bid increments would be 1c up to 10c, 2c to 20c and 5c thereafter to merge with the existing increments. Heaven forbid! There are already too many under 10c lots in the auction.
Roy
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
"Somehow I just knew it was about those penny auctions of mine......."
More about the wise guys who bid a penny!
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
"So, I have an idea of what I think is logical and fair. But that may not - probably is not - definitely(?) is not - the situation here. "
Dave, breathe deep and calm down! Everything will be okay! It's a computer. Computers are good. They cannot be wrong. Just relax and enjoy the blinking emoji!
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06:08:04am
Auctions - Approvals
re: Clarifying Proxie Bids - Is There an "Inefficiency"?
As they say in the auction world "Don't lose it for one more bid"
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Obviously the simple solution is to bid $2 on every penny auction. Who would beat you? (well one guy would but he left this site almost as soon as he joined it)
Greg
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
In honour of my boy brechinite, I am going to bid a farthing on soundcrest's auction today.
And all is good. I now know the algorithm and where I have gone wrong before.
Unfortunately, after further analysis I determined this will reduce the sales of a certain "dealer" by up to 3c per month. Fortunately, the "dealer-haters" can offer even more "thanks-giving" for that. Good timing!
Woo hoo! Making everybody happy!
Dave.
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02:41:16pm
Auctions - Approvals
re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Lemaven:- confuse everybody by bidding either a groat or better still a bawbee.
Please Note I said groat not GOAT!!
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Somewhere I have a 1/3 farthing.
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re: Clarifying Proxie Bids - Is There an "Inefficiency"?
"In honour of my boy brechinite, I am going to bid a farthing on soundcrest's auction today."
A quarter of a cent, eh? Dave - two questions - does the system accept decimals, and if you win, are you going to cut Mr. Lincoln in four? (I'd say good Queen Bess, but US currency is the standard here)
You could be onto something truly revolutionary, Dave!
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06:19:15pm
Auctions - Approvals
re: Clarifying Proxie Bids - Is There an "Inefficiency"?
Of course instead of bidding you could ask to trade, because I bet that isn't the only copy he has.
The old barter system can still work at times
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